Gambling Bitcoin has a floating loss of over 55%, President Salvador: Be patient, will rise after the bear market

Since 2022, the price of Bitcoin has fallen by about 57.1%. As the first country in the world to use Bitcoin as a legal currency, the value of Bitcoin held by Salvador in Central America has also been cut compared to purchasing costs. However, President Nayib Bukele did not care about a moment of profit and loss, and believed that the price of the currency would rise in the future.

In June 2021, with the promotion of Bakl, under the age of 40, the Salvador legislature approved the legal currency of Bitcoin as another US dollar. Subsequently, the Salvador government bought 2301 Bitcoin in ten times. According to the statistics of the website of the country's Bitcoin assets, the total cost of Salvador's coin purchase was US $ 105 million, with an average purchase price of nearly US $ 46,000 per/USD. According to the latest currency price ($ 20453.57), the Bitcoin in Salvado has floated 55.45%.

Image source: naturalibtracker.com

After the Federal Reserve raised 75 basis points last week, the price of Bitcoin dive again. On June 18, it fell below $ 20,000, which was as low as $ 17663.8 per/American. Under the pressure, Bucker had to come out to calm people's hearts. On June 19, local time, he said in social media that Bitcoin investment is safe. After the bear market, its value will rise greatly. Patience is the key to Bitcoin investment. "My suggestion is to see the price map anymore. , Enjoy life. "

Salvador's Minister of Finance Alejandro Zlaya's justification is even more exciting. On June 15th, Zlaya said in an interview with TV stations that some people said that the price of Bitcoin plummeted has intensified the risk of budget at Salvador. This does not exist, because Salvador did not sell Bitcoin and did not lose money without selling. He also emphasized that Bitcoin investment accounted for less than 0.5%of Salvador's budget.

El Salvador established a $ 150 million fund to buy Bitcoin. This amount only accounts for about 4%of its US dollar reserves, and the proportion is really not high. However, as a country with backward economic development and tight cash flow in Latin America, the impact of Bitcoin investment losses is far more profound than the profit and loss on the book.

According to Julio Sevilla, a professor at George's University of Business School, Salvador's GDP is about $ 25 billion, liabilities exceeded $ 20 billion, and the debt ratio is very high. President Bakl has been negotiating with the International Monetary Fund (IMF), hoping to get debt -re -financing, but the IMF has a strong criticism of the Salvador Bitcoin plan and believes that its risks are too large. Bitcoin Fund transferred the funds back to the country's treasury. Salvador's criticism is resolutely opposed to the criticism of the IMF, arguing that setting Bitcoin as a legal currency is a "sovereign issue" that cannot compromise.

At present, Salvador's $ 800 million bond will expire in January next year, but whether the government can obtain reinstatement to cover the loan still has uncertainty. On June 1, the S & P global rating reduced the rating of Salvador to CCC+, which is the same as Ukraine, which means that the risk of debt default is very high.

Daily Economic News

- END -